Organizational Change

Management
Organizational change
• For change to succesfully happen, benefits must be perceived to
outweigh costs.

• Dissatisfaction with status quo x Model of future x Process of

change > Cost of change

• All change is about building a coalition of people via effective

communication and outreach
Organizational change process
Step 1: Classify the people
Step 2: Identify the source (of disagreement)
Step 3: Choose the method
Step 4: Consider the context
The people

Active resister Passive resister Neutral Passive supporter Active supporter

The source

Goals
Disagree Agree
Methods

Disagree Divided Polarized

Agree Disjointed Unified

The people
• 1- Classify people into buckets
• 2- Push neutrals to fall into passive or active support category
• Identify the source of agreement or disagreement
• 3 - Determine the appropriate method for resisters
(persuasion/coercion)
• 4- Achieve critical mass
The method
Method How to use When to use Advantages Drawbacks
Communicate the Employees lack information Once persuaded people Time consuming (if many people
Education desired changes and
about change implications
often help implement
are involved)
reasons for them change

Involve potential Change initiators lack People feel more Time consuming +execution
Participation resistors in designing and sufficient information to
Persuasive

implementing change design change committed to change hurdles

Provide skills, training,

Facilitation and support People are scared or fearful No other approach works Time consuming and expensive

Offer incentives for People have considerable Easy way to defuse People may blackmail during the
Negotiation making change power to resist resistance execution

Threaten of loss,
unilateral decision
making, firing or Speed is required and Works quickly to overcome
Coercion transferring those who
initiators have considerable
resistsance
Sabotage and stonewalling
power
can't or won't support
change.
The Context
Proclivity to implement power
Lessons from Milgram experiment
• The foolish rebel against hierarchy. The wise get into positions of
‘power’
• Even if not, people arrange themselves in hierarchies
• Power - The factor that comes into play when you are not a ‘genius’
• We see the world as more ‘fair’ and ‘just’ than required
• Less strategic than required
• If I don’t do anything wrong, then nothing will happen to me
• Atleast 30% of you will quit organizations because of the implementation of
‘power’
• In an organization, cultivation of ‘informal power’ is the key to success
Bases of Power: Formal Power
• Formal Power
• Power resides in the relationship and relationship carries some resource
• Coercive Power
• A power base dependent on fear of negative results
• S: Power distance, legal policies/frameworks (appraisal – supervisor/360)
• A: Reduce power distance, target policies rather than person
• Reward Power
• Compliance achieved based on the ability to distribute rewards that others view as valuable
• S: Favoritism, Loans, ESOP’s, promotions,
• A: Moral grandstanding and narratives –debates on executive compensation
• Legitimate Power
• The formal authority to control and use resources based on a person’s position in the formal hierarchy
• S: Designation/position, Centrality, Visibility, Relevant
• A: Criteria for position/designation (not meeting norms), Remove centrality, check and balance, reduce visibility, Substitute
• Ex: HR departmental relevance and budgets
Bases of Power: Formal Power
• Controlling Formal Power?
• Techniques to maintain power distance in organizations and make it more
equitable
• Organizational Structure
• Ex. Zappos
• Communications
• HR policies: Dining, shared spaces,
• Infrastructure: Cubicle design
Bases of Power: Personal Power/ Persuasion
• Power that comes from an individual’s unique characteristics – these are the most
effective
• Expert Power
• Influence based on subject/domain expertise
• S: Knowledge, skills
• A: Hiring practices - 2 or more; L&D process – encouraging or restricting, knowledge sharing policies, purposive
mentorship
• Referent Power
• Influence based on possession by an individual of desirable resources or personal traits
• S: Charisma, inspirational, Uncanny, Visionary, Rhetorical
• A: Rational, Support structure, allies

• Convince. Corrupt. Coerce – in that order

Power and Context

Urgency

Low High
Power/Authority

High Evolutionary and Accelerated and highly

moderately disruptive disruptive
Low Evolutionary/minimal Accelerated and
disruption disruptive (need for
coalition)